Construction activity showed further weakness as spending on homes dropped for a record eighth consecutive month.

The Commerce Department reported Wednesday that building activity edged down 0.2 percent in November to a seasonally adjusted annual rate of $1.18 trillion. That followed declines of 0.3 percent in October and 0.8 percent in September.

The weakness was led by a 1.6 percent plunge in home construction, which followed an even bigger 1.7 percent drop in October. Analysts believe home building will remain weak for several more months as builders struggle to work down a huge backlog of unsold homes.

The slump in housing has been a big drag on the overall economy, trimming 1.2 percentage points off growth in the July-September quarter, when the economy slowed to a lackluster 2 percent growth rate. The slump in October and November indicates housing will remain a serious drag in the final three months of the year.

The housing decline pushed spending on residential buildings down to a seasonally adjusted annual rate of $589.3 million in November.

Housing has been in a slump this year after a prolonged boom that was fueled by the lowest mortgage rates in more than four decades. However, that boom triggered increased speculation, driving home prices up sharply in many parts of the country.

Spending on nonresidential projects actually showed strength last month, rising a strong 1.5 percent to an all-time high of $316.5 billion at an annual rate. The increased reflected strong gains for office buildings, hotels and shopping centers.

Government building activity rose by 1 percent to an all-time high of $278.4 billion at an annual rate. That reflected a 1.1 percent rise in state and local building projects which hit a record of $258.7 billion. This increase offset a 0.8 percent fall in spending on federal projects which dipped 0.8 percent to a rate of $19.7 billion.